Rejewvenate!

Ultra-Orthodox missionaries from Bnai Brak have hit upon a very old scheme for gaining adherents - monetary incentive. As Ynet reports, Hareidi rabbis have been offering poor high school kids in Ramat Gan 18 shekel to attend a Torah study class.

I’m a little stunned. It is not acceptable behavior to bribe high school students in this manner. Talk about not passing the smell test! Would it be okay for secular Israelis to bribe Hareidi students to eat pig, or attend a lecture on evolution? If I found out that somebody was bribing my kid in order to indoctrinate him without my consent I would be driven to violence! Subverting parental choices about education and basic values goes beyond merely disrespectful. It is a violation of basic parental rights and a brazen act that will surely result in grief to all parties.

And from Israel, no less. I was recently emailed a responsum regarding what constitutes a reliable Hechsher from Rav Aviner, the Rosh Yeshiva of Yeshivat Ateret Cohanim in Jerusalem I am reproducing the responsum in part. If you would like the whole things, please email me at rejewvenator[at]gmail.com

Question: Is it acceptance to eat food under the kosher certification of the Chief Rabbinate of Israel or should I only eat from Badatz?

Answer: Quite simply, all kosher certification is acceptable, whether it is Mehadrin, Badatz, or the Chief Rabbinate. Any product with any kosher certification is presumed to be acceptable until proven otherwise. We rely on the principle of “chazakah – presumption” based on the Gemara in Niddah (15b) that a Torah scholar “does not allow food to leave his domain without its kashrut being ensured.”  [...] There is, however, a general principle: We must not doubt the kosher certification of Rabbis. It does not matter which Rabbi who gives certification – whether it a Rabbi with a knit-kippah or with a velvet kippah. If we say that it is not kosher, we are saying that this Rabbi is a sinner. He is feeding non-kosher food to the Jewish People! This is a serious accusation. This thought itself is the height of non-kosher thinking. Why would he do this? What is his motivation? He wants to make money? In order to make money he is willing to feed non-kosher food to people?! Making such an accusation against a Torah scholar is a serious transgression. One must be very careful about acting this way. [...] All kosher certifications of all Rabbis are therefore acceptable until proven otherwise. I am obviously only referring to Orthodox Rabbis who are particular about the laws of Kashrut.

This type of halachic reasoning affirms that principle of derech eretz kadma la-Torah. Rather than falling into a discussion of halachics, R. Aviner recognizes the underlying principles of respect due to one another, and particularly, respect due to Rabbis, who are themselves ‘certified’.  But wait, there’s more!

Question: Nonetheless, perhaps I should be strict and only eat food with the kosher certification of the Ultra-Orthodox?

Answer: May a blessing come to anyone who is strict. The Talmud Yerushalami quoted by the Tosafot in Avodah Zarah (36a) says, however, that one of the conditions of one who is strict is that he does not shame other people and, all the more so, a Torah scholar. [...] Someone who wants to be strict can be strict about whatever he wants, not necessarily relating to the laws of kashrut. He can be strict about the laws of tzitzit or Shabbat or lashon ha-ra (evil speech) or the Land of Israel or loving other people. Each person can choose to be strict about whatever he wants, but a person must also know where he stands. The Book “Mesillat Yesharim” discusses being strict in “Sha’ar Ha-Perishut – The Gate of Abstinence”: A. To separate from any pleasure which in unnecessary in life. B. To act strictly regarding everything in the world. C. To dedicate all of one’s time to divine service. I do not know if we are at this level. I am not at this level. A person who wants can be strict, but he must remember the “Vidu’i” (confession) of Rav Nissim Gaon: “For that [on] which you were strict, we were lenient; for that [on] which you were lenient, we where [sic] strict.” You were strict in the laws of kashrut, but lenient in the laws of lashon ha-ra. If you want to be strict, you can be strict, but I say that it is more important to be strict in honoring Torah scholars.

Of course! A lesson we teach to Baalei Teshuva (Jews returning to or first taking on traditional observances) is to recognize where you are, and not take on too many commitments if you are not at the point where you can truly maintain them and feel authentic about that level of observance. It’s a lesson we are often not even taught when being raised inside the religious community. Better to observe at a level that is consistent and authentic with your heart, and to take on strictures that are personally meaningful, than to be herded by a community into a hypocritical lifestyle of strict piety that holds no personal meaning for you and misrepresents you before God and man. It is comforting to hear R. Aviner expressing these sentiments, and taking aim at a ritual that has spun out of control and threatens the very meaning of Kashrut.

The New York Times had an article today covering payday loans, which have replaced credit cards as the most egregious form of legal usury sanctioned int his country (though I am fortunate to live in New York, one of twelve states to ban this sort of chicanery).  Here’s how it works:

For Ms. Truckey, as for most payday borrowers, the loans began as a stopgap. After losing her job in 2002 she borrowed $500 from a payday store, which charged $22 per two weeks for every $100 borrowed, or the equivalent of 572 percent annual interest. When the loan came due in two weeks, she could repay only the $110 finance charge, so she rolled the loan over, adding another finance charge.

That’s right, 572%! That’s  more than twenty-five times the already-ridiculous rate your credit card company is charging you - and at least they offer you a grace period of a few weeks before the interest kicks in. But wait, all hope is not lost - there’s a company taht’s trying to make it better:

At GoodMoney, tellers encourage borrowers to consolidate their debt in lower-interest term loans, and to use other credit union services like automatic savings. If borrowers cannot repay a loan after rolling it over twice, they can get the loan interest-free by attending a free credit counseling session with a nonprofit service.

What a relief. I wonder what the kind folks at GoodMoney charge for a lone. They seem so understanding, so helpful, so in touch with the needs of the community. Let’s find out.

But alternative payday loans have also drawn criticism from some consumer advocates, who say the programs are too similar to for-profit payday loans, especially when they call for the principal to be repaid in two weeks. At GoodMoney, for example, borrowers pay $9.90 for every $100 they borrow, which translates to an annual rate of 252 percent.

Holy Mackerel! What a business! I wonder how much of that 252% interest they actually manage to take home. According to Ken Eiden, president of Prospera Credit Union, the folks behind the GoodMoney program (along with Goodwill), almost half goes to writing off bad loans. Which leaves a whopping 126%, that Mr. Eiden claims goes to database and administrative services. The GoodMoney program is supposedly non-profit, which leaves me wondering where all the money is goign. Credit card companies and banks don’t gross a fifth of the 125% that GoodMoney nets, and since banks and credit card issuers do run credit checks and do verify income, they presumably have more overhead than GoodMoney. Something doesn’t smell right to me.

One things is for certain, and it’s that America is drunk on credit. On the one hand, access to credit markets is a tremendous boon. It allows businesses to open and expand, enables families to purchase homes and cars, and empowers cities, states, and nations to meet unexpected needs. However, as many before me have analogized, debt is slavery. Owing money controls your choices, limits your freedom, and constricts your personal autonomy and dignity.

We all know by now of the predations of the credit card industry, with their outrageous interest rates, hidden fees, double-cycle billing, incomprehensible terms and conditions, and policies designed to keep customers in debt forever. We’ve recently learned about similarly deplorable conditions in the education loan market, where complicit colleges have turned their campuses into private game reserves for unscrupulous lenders (though, as GoodMoney demonstrates, I’m not even sure what a scrupulous lender looks like anymore, or even if one exists).  And you’d have to be off at some kind of foreign military quagmire not to have heard about the orgy of delusional lending and borrowing that has led to a major crisis in the international credit markets.

And that’s what’s so infuriating. When the ordinary borrower is finally drowned in that vicious whirlpool of fees, penalties, and astronomical interest rates, there’s nothing to be done. Even bankruptcy no longer offers a new start. But when banks and hedge funds get burned while speculating with borrowed money, in comes the Fed, offering billions of dollars in loans at below-market rates. All you have to do is pull up to the discount window and take what you need! Bailouts for everyone! This isn’t capitalism - you know, the kind where the losers of the ferocious competition for fiscal survival get carried out on stretchers - this is socialism for the rich! I don’t see the Fed lending money to people whose adjustable mortgage rates have readjusted three or four points higher.

Maybe the Torah was on to something when it spoke of interest-free loans secured by collateral. Sure, it’s not a away to make money. It’s a form of charity. But isn’t the Fed offering charity right now too? Only they’re offering it to the rich, who, by their own choice, took foolish risks and have now gotten burned. There’s a distinction between those who use credit and those who need credit. For many of us, credit enables prosperity, but for some, credit is a matter of survival. Isn’t it time we started drawing that distinction with a bit more sense, and a bit more humanity?

DovBear et al: Glatt kosher investments in the stock market?

A guest post on DovBear raises the issues of stock ownership and Jewish law. The gist of it is that since owning a share of stock is ownership (and usually voting rights) in a company, and since Jews are prohibited to benefit from a variety of behaviors, such as labor on the Sabbath, stock ownership is fraught with problems for the traditionally observant Jew.

To get around this problem, some Israeli hedge funds have created portfolios out of index funds, bonds, and stock options. In all three cases, the instruments owned do not represent an ownership stake directly in any business, nor are the instruments traded on Shabbat or holidays by the hedge  fund. However, the options purchased are options to buiy or sell stock of companies that do violate any of the variety of problematic prohibitions.

I wonder how many Jews are attuned to this issue. Most of the investors that I know invest in indexed mutual funds, not in individual stocks. However, I know lots of people who made money in the IT boom by buying individual stocks of companies whose employees were most certainly working on shabbat, and were most certainly Jewish. Is this something we should be paying attention to? The technical connection between business ownership as envisioned by the Talmud and stock ownership is quite solid. Owning stock gives the rights to a share of future earnings, and comes with voting rights to help set company policy. True, you can’t run the business from the floor of a shareholder’s meeting, but is your inability to make the company conform with Jewish law an excuse for not observing it yourself, or  is it an indication that you shuld not involve yourself with such a business?

If you want to be technical, then you must ban ownerhsip of those stocks, even as you embrace ownership of bonds and options in those same companies. On a technical level you’re free and clear - there’s no bar on lending money to someone who violates the Law (though priority should be given to “your nation, the poor who live among you”), and trading options carries no ownership stake whatsoever (unless you need to actually exercise the option rather than just trade it in, but even then your holding time is so short as to be de minims, imo).

If you prefer taking a broader, non-technical view, you wind up becoming a values-investor. Though the extent of ownership that stock confers may not rise to the level where you would avoid it because of halachic  concerns, investing in companies that clash with your values is a larger problem. It also stops mattering whether the investmen is stocks, bonds, options or more complex derivatives. Benefiting from a company’s performance when that performance runs contrary to your ethics is repugnant in any form. I suppose short-selling would be ok though…

I was skimming through the various blogs I follow when I came across this:

Kol Ra’ash Gadol: Plastic water bottles

KRG seems decidedly unconvinced that limiting our use of plastic disposables is a worthwhile idea. While we can argue about the various environmental merits of the case (which I did, on his blog) what about the Jewish perspective? Rabbi Brant Rosen writes about Bal Tashcit on Radical Torah, indicating that efficiency and conservation are Jewish values, straight from the Torah. He brings the Rambam, who says:

Whoever breaks vessels, or tears garments, or destroys a building, or clogs a well, or does away with food in a destructive manner violates the negative mitzvah of Bal Tashchit (Hilkhot Melakhim 6:10)

Is there any reason that the words of the Rambam should not apply to disposable goods? I would argue that the standard plastic water bottle of our day is comparably durable to the vessels available at the time of the Rambam. The only thing that makes them ‘disposable’ is the marketing campaign. Anyone see The Gods Must Be Crazy? That glass Coca-Cola bottle had a hundred uses for a people who had no concept of ‘disposable’. Is it in fact forbidden to throw away these and all the various other containers that make their way into our homes?

At my house, we do try to re-use these containers. We save jars and re-use them for storage containers, pickling vessels, and even drinking glasses. My favorite lowball glass is actually the glass cup that yahrtzeit candles come in. Our dish soap dispenser? A bottle of Poland Spring water with the sport top. What we don’t re-use we try to recycle. But we are in the minority. Here then is another Jewish value, and another halachic injunction, that is ignored and even deprecated by the frum community. I’m not suggesting that disposable goods ahve no place in our society, but I’m troubled that we have embraced this part of secular culture with hardly a second look.

And since we’re on the environment, October 15 is Blog Action Day! Got a blog? Why not spend the day uniting with bloggers around the world to talk about just one thing? This year, it’s the environment. Show your support! And go out and tag all your bloggy friends and get them to jump in too. I’m tagging Jspot.org (I’m looking at you, Mik Moore!), Jeremy Rosen, and my various buddies, the mennu method, Meeg, and the newly-constituted Kol Hamevaser - lead the way!

Daniel Septimus comments:

We are all aware that when we turn to Jewish tradition for teachings that inspire us to work for social justice, we often turn a blind eye to texts that can inspire the opposite: religious paternalism, inequality, brutal forms of capital punishment, and yes, even race-based genocide.

But is this okay? Can we credibly cite Jewish teachings that encourage a better world when there exist parallel teachings that could lead to a worse one?

The comments were made in the context of writing for the America Jewish World Service Dvar Tzedek program, which publishes an ethics-based commentary on the parsha each week. He goes on to point out that although it is very easy to cherry-pick, especially in Sefer Devarim, those ideas that ore most consonant with our own ethics, those other ideas must be addressed.

Whether we condemn these texts or merely note their difficulty, they are our responsibility. If we ignore them and fail to forge communal opinions about them, we risk the possibility of them being resurrected and reclaimed.

Of course, it goes well beyond possibility. I have personally heard members of the settler movement claim that Palestinians are the modern-day Amalek, or more moderately, among the seven nations of Canaan who must similarly be exterminated. The ongoing issue of Agunot is another living example of this problem.

What is to be done? Rabbinic Judaism had a pretty good answer in the systematic evolution of halacha. The elimination of capital punishment, polygamy, and corporeal punishment, and the institutions of ketubah, heter iska, and prozbol addressed many problems in ethics and social justice. Unfortunately, our denominations today can’t seem to find that path. Orthodoxy has abandoned the notion of evolution of halacha in favor of a plainly falsifiable belief in static halacha; Reform have abandoned halacha altogether. In the words of Rabbi Eric Yoffie, president of the Union for Reform Judaism, “If you take it all upon yourself as an obligation rather than as a choice, you’ve reached the point at which you’re no longer a Reform Jew.” Taking it one step further, Reconstructionist Judasim simply denies God’s existence (let din v’leit dayan). As for the Conservatives, they are riven in at least twain (though in truth, the complexities of their divisions may indeed be a strength, as their new generation seeks to marry the most progressive ethical notions with the most traditional and restrictive Halachic norms). Right now, the movement could be fairly described as ish hayashar b’eynav ya’aseh - each person does as he sees fit.

What’s needed is a revival. Not a revival of Jewish culture or reconfiguration of Jewish conecpts a la the FrankenJews at Jewcy. Not a new commitment to Jewish texts and text study, which so often is agenda-driven. What’s needed is a revival of Yirat Shamayim - fear of God. Acceptance of the idea of Mitzvah-as-commandment, not as good deed, or even favor-to-the-Jewish-People, or even as a nourishing aspect of self-identification.

Today is the second day of Elul, a time for introspection, evaluation, repentance, and renewed commitment.  It is marked by shofar-blasts at shacharit, the morning prayers recited by probably no more than one-tenth of the Jewish population in the US. Hayitaka Shofar ba-ir V’ha’am lo yecherad (can a shofar be blown in a city, and it’s inhabitants not tremble?) (Amos 3:6). The question is asked rhetorically, but today, the shofar’s call is barely heard, much less heeded. I want to end today with the words of the captain of the ship that Jonah sailed upon to avoid his stern, commanding God’s decree :

ו  וַיִּקְרַב אֵלָיו רַב הַחֹבֵל, וַיֹּאמֶר לוֹ מַה-לְּךָ נִרְדָּם; קוּם, קְרָא אֶל-אֱלֹהֶיךָ–אוּלַי יִתְעַשֵּׁת הָאֱלֹהִים לָנוּ, וְלֹא נֹאבֵד.	6 So the shipmaster came to him, and said unto him: ‘What meanest thou that thou sleepest? arise, call upon thy God, if so be that God will think upon us, that we perish not.’

(Jonah 1:6) The Rambam tells us that the shofar calls to us to awaken from our slumber, and to return to God. Sometimes, as in Jonah’s case, that return is painful, and the task before us is unpleasant. It requires personal abnegation, not affirmation. We may be called upon to do that which we find distasteful, or even that which we are diametrically opposed to. But we cannot, and we should not flee it. Even in the depths of the sea Jonah did not find comfort, only a temporary escape. It’s time for us to make our accounting before God, to face the music, and acknowledge that there is a Law, and Judge who holds us to it.

Jewcy has the pics of the Maimonides alumni event. Here’s a little-known fact:

In Feldman’s words: “6 out of 7 [photos] included our picture; one did not; that one was published. No one I know really thinks the selection was random, and of course neither does Maimo deny it if you read closely.”

The Feldman Flare-Up | Jewcy.com

I’ve recently taken a renewed interest in economics and finance, and I find myself wishing that there was a good blog about Judaism and economics. I read plenty of Jewish blogs that are interested in economic issues, like the JSpot blog run by Jewish Funds for Justice. What I’m really looking for though is a blog that addressed the economic implications of Jewish social justice and mitzvot.

A couple of months ago, my friend Yechiel Newman gave a wonderful dvar Torah about charging interest, and I have adapted it, with his permission, for this blog. I hope to one day convince him to blog about Judaism and economics, but for now, all we get is a taste:

Shabbat Shalom

One of the classic rivalries between Jewish thinkers is that of the Rambam (Maimonides) and the Ravad (Rabbi Avraham Ben David of Posquieres). These two great Jewish philosophers found little they agreed on and went to great lengths to discuss their disagreements. In fact, when I was teenager growing up in Brooklyn, the rabbis at my yeshivah would joke that the proof of God’s existence can be easily deduced. The logic was simple — The Rambam stated that God exists and the Ravad did not disagree.

If truth can be deduced from the absence of disagreement between rivals, then, it follows, there can be no greater truth than of the evil of charging interest on loans. For Islam, Christianity and Judaism universally agree that collecting interest is prohibited.

The Koran in Sura Al-Imran verse 130 states

O you who believe! Devour not interest, for it goes on multiplying itself and be mindful of your obligation to Allah that you may prosper; and safeguard yourselves against the Fire which is prepared for disbelievers. (Koran 3:130)

The prohibition against collecting interest is seen in the Torah a few times. For example, in Exodus 22:24

The New Testament, in the Parable of the Talents seems to suggest that interest was actually acceptable. Briefly, the Parable speaks of three servants, each of whom was entrusted with a sum of money during their master’s absence. Two of the servants used the money in the service of some business venture, and doubled the initial sum. The last servant, who was given the least money, feared that he would lose what little was given to him, and so he buried the money to ensure that he could return it to his master when his master returned to collect it. In Matthew 25:29 we see the last servant being chastised by the master for this act: “Then you ought to have put my money in the bank, and on my arrival I would have received my money back with interest.”

However, in spite of this verse, in the Middle Ages, the Church eschewed their own teachings and declared the charging of interest as usury, and, therefore, illegal.

So, whether you are a Muslim, a Christian, or a Jew, the evil of interest is spelled out to you in no uncertain terms.

As an aside, the Buddhists spent so much time convincing their followers to divest themselves of all worldly possessions that developing a position on the “interest issue” was not high on their agenda.

For Jews, the halachic prohibition against interest is far-reaching in scope. Jewish borrowers are not allowed to offer preferential discounts in to a lender in their business dealings, as that could be construed as implied interest (Avak Ribbit). Even something as insignificant as the borrower thanking the lender is prohibited, as this display of gratitude is considered an ill-gotten gain from the loan.

A modern day thinker may wonder, how is it possible to live in a world without interest? Surely interest, as a free-market inducement between borrower and lender cannot be forbidden under a reasonable social system. Though borrowers would certainly prefer not to pay interest, lenders do not charge it out of cruelty, but as a reflection of two factors: the risk inherent in lending money to another, and the time value of money (a dollar now is worth more than a dollar next year irrespective of risk, simply because you can exchange today’s dollar today, but you must wait until next year to convert that dollar into some good or service). What kind of socio-economic system is the Torah advocating?

The importance of interest was explored by Ludwig von Mises — one of the founders of the Austrian School of Economics and a noted Libertarian thinker. Von Mises wrote in his treatise on Human Action:

Therefore there cannot be any question of abolishing interest by any institution, laws or devices of bank manipulation. He who wants to “abolish” interest will have to induce people to value an apple available in 100 years no less than a present apple. What can be abolished by laws and decrees is merely the rights of capitalists to receive interest. But such decrees would … very soon throw mankind back into the original state of natural poverty.¹

Facilitating commerce, and in particular, loans, was something the Gemara felt strongly about. In Sanhedrin 2b the Gemara discusses the importance of judges performing rigorous due diligence of all witnesses that come before them. The Gemara ponders the possibility that a distinction should be drawn between the typical due diligence necessary of all witnesses and the due diligence necessary when witnesses come forth on monetary matters. The Gemara states that if the courts were to apply the same level of rigor in their examination of witnesses to loan contracts as to witnesses in other matters, the courts would be placing a heavy burden on lenders trying to recover their money. The Gemara therefore ruled that extensive due diligence of loan witnesses was not in the public’s interest since it will effectively “lock the doors of the lender to the borrower”.

Though normally the courts required a very high standard of proof in order to uphold a claim, in the case of loan contracts, such a high standard would greatly increase the risk that a lender would be unable to collect on his loan. Since lenders would be unable to collect interest commensurate with this level of increased risk, lenders would simply pull out of the capital market, and seek other investments with lower risks and better rates of return.

With the policy of not “locking the doors of lenders” in mind, Jews have developed a special type of loan document called Heter Iska (literally, a business permit). The Iska contract is structured like a trust or partnership, but, viewed in the abstract, has a financial outcome in line with that of loaning money for interest. The way it works is that two parties who might have normally entered into a lending relationship instead form a partnership or trust. The would-be lender becomes an investor, providing capital to the would-be borrower, who in turn becomes the manager of the trust. Profits are divided in such a manner that the investor earns a rate similar to what he would have earned as a lender charging interest. In addition, a buyout clause enables the manager to ‘repay’ the investor and end their relationship. (See JLaw.com for a standard Heter Iska form.) Note that while the Heter Iska functions well so long as the business venture is profitable, as a practical matter, the failure of such a venture leaves the lender cum investor with little halachic recourse for recovering his investment should the business fail. Such cases often wind up in secular courts - see Kenneth Ryesky’s treatment of the Heter Iska in secular courts.

It should be noted that both Christians and Muslims have also found ways to work around the prohibition against charging interest. When the Church issued its decree against usury it allowed Jews to engage in money-lending. Jews, who were left out of the formal guild system, found themselves with no other source of income than money-lending. In the long term, the results were disastrous for the Jewish people since they would eventually find themselves stereotyped as evil for conducting these very loan. In the near term though, Jewish bankers quickly became an integral and irreplaceable cog in the European economy, providing financing for everyone, from farmers to craftsmen, merchants to manor lords, and even kings and generals.

Islam, under Sharia, takes a slightly different approach than the Heter Iska. Muslim lenders enlist a third party who sells an asset to the borrower at a guaranteed profit. This profit is paid out to the seller, who is an agent of the lender, over the period of the loan. For example, let’s say Yousef wishes to borrow $10,000. Abdul is willing to lend $10,000 to Yousef at a 20% interest rate. To circumvent the prohibition against interest, Abdul purchases a car from Faisal for $10,000, and sells the car to Yousef on a payment plan of $1,000 per month. Yousef winds up paying $12,000 over the course of the year in exchange for the $10,000 he received at the beginning of the year. Neither Abdul nor Yousef ever take delivery of the car, or even see the car. For that matter, the car may not even exist! This so-called “business transaction” has created a situation in Saudi Arabia where a car dealer with eight dusty Yugos on his car lot has annual revenues greater than the Gross National Product of a mid-sized country.

So we are left with an economic puzzle. If interest is acceptable, as can be seen from the Heter Iska document, then why does it state clearly in the Torah that interest is forbidden? And, if interest is forbidden, why are we given this easy out with the Heter Iska? On the one hand we have a direct prohibition against interest up to and including receiving a spoken thank-you, and, on the other hand, we are allowed to engage in transactions that are essentially the same as interest bearing loans.

To attack this puzzle I suggest we look at the context of the laws relating to interest.

If we look at the relevant texts we will find that the laws of interest are closely related to some interesting laws about employment and collateral. We are told an employer must pay wages on the day that the work is done. We are not supposed to let the sun set without fully compensating an employee for a day’s work. Additionally, we find that if a poor person comes to you for a loan and collateralizes that loan with his own garments, then you, the lender, need to return the garment to the borrower each night before sunset, since, as the text says, “This alone is his covering .. With what shall he sleep” (Ex. 22:26). The Chafetz Chaim took it for granted that these three laws were intertwined. In fact, the first chapter of the Chafetz Chaim’s book, Ahavath Chesed, is titled “Laws of Loans, Pledges, and Wages.”

It is the proximity of these laws that helps us to solve our interest puzzle. I suggest, that The Torah is not instructing the two parties to a loan to defy the natural laws of the market. Rather, the Torah is teaching us how to conduct ourselves when there is a disparity in power between the two parties. By including the laws of loans among the laws of employment and collateral the Torah is telling us that when we find ourselves in a more powerful position, because of another person’s financial weakness, we should not exploit that opportunity.

Many people in this room may have read the works of Ayn Rand. The collection of her writings form a system of ethics known as Objectivism. Objectivism teaches us that selfishness is a good thing. Adam Smith, an economist most famous for how writings on free trade postulates that when each person arranges his affairs in the most “selfish” way an “invisible hand” causes the outcome to be best for society.

John Mackey, founder and CEO of Whole Foods, questions this worldview in an inspiring speech he gave to a recent Libertarian conference

He said:

… despite her literary greatness and many positive contributions to the freedom movement, I believe that Rand has also harmed the movement. How? She was overly provocative. The “virtue of selfishness” is an oxymoron. Selfishness is not a virtue. Now, I understand all the arguments — I’ve read all the books. I know that self-interest channeled to the social good, as expressed through Adam Smith’s “invisible hand,” is the single most brilliant insight about social organization ever made in history. That being said, selfishness (as opposed to self-interest) is still not a virtue. It is something to be discouraged, and not something to be supported.²

I believe John Mackey’s message echoes the message we are meant to take from the Torah’s prohibition against charging interest on a loan.

Interest per se is a great thing. It allows us to rise from the natural poverty, as Von Mises stated. In the form of microfinance, interest enables thousands of people from developing countries to escape hardship. In the form of a mortgage interest it allows each of us to own a home. Interest is a tool to harness risk and to temper inflation. For all of these reasons and many more, we are given the Heter Iska.

But, interest also has a darker side. As an example, there are companies in the United States that offer “payday anticipation loans - very short term loans that are to be repaid from the borrower’s next paycheck. These loans are given at very high rates of interest and are only attractive to people who cannot wait until their payday at the end of the week. Although the moral case for these loans can be made from an economic perspective, the Torah instructs us otherwise. The Torah tells the employer not to exploit his position of power and force the employee to borrow money that is rightfully his. The Torah tells the employer to pay the employee immediately.

In this week’s Parsha we are instructed “Kedoshim Tehiyu” — be holy. This positive commandment to follow a moral compass in our daily actions is a catch-all. It is recognition that we are faced with economic puzzles each day that call for moral clarity. Faced with the duality of interest as both a source of good and an instrument of evil – Kedoshim Tehiyu instructs us to use the Heter Iska where appropriate, but, also, take care to not exploit our neighbors in their time of greatest need.

1 http://www.mises.org/humanaction/chap19sec2.asp

2 http://libertyunbound.com/archive/2006_06/mackey-winning.html

I remember a many years back, real-estate brokers tried to sell people on moving to the fictitious neighborhood of West Lawrence. The neighborhood, more commonly known as Far Rockaway, sits just west of the Five Towns village of Lawrence, and has many Orthodox residents and synagogues, and is accessible to the Five Towns shopping districts. It is also a far more affordable neighborhood, located on the Queens side of the Queens/Nassau border. As teenagers, my friends and I would refer unkindly to the area as Black Lawrence, a play on the name of the ultra-wealthy Back Lawrence section of Lawrence, as well as a not-so-sensitive reference to both the Yeshivish Jewish enclave, and the black and Hispanic residents who predominated.

For many, the decision to move to Far Rockaway was a financial one. Though the Five Towns offered some significant advantages over Far Rockaway, not least being lower crime and cleaner streets, Far Rockaway offered lower prices for housing and significantly lower property taxes. Living in a sea of impoverished immigrants and other minorities may have discouraged some, but others were content to ignore the problem by living within the “Jewish” areas. The trend I saw at home continues abroad, as I read in the Forward:

“Suburbia Sells Settlers on the West Bank - Forward.com”

The article indicates that many olim are replicating their American lifestyles by taking advantage of some absurd incentives. My wife and I have long joked about our friends who moved to what we call the Bet Shemesh section of Teaneck, with all its Anglos, minivans,  and wood flooring. Still, living in Israel is a great mitzvah, and while we scoffed at the desire to continue living an American lifestyle even while in Israel, we accepted that those who chose to afford this life were within their rights and were not harming anyone else.

Can the same be said for settlements in the West Bank? As with everything else, generalizations are dangerous. Living in Hebron is different from living in Ariel, which is in turn quite different from living in Gush Etzion. Nevertheless, some strange economic incentive are operating here.

According to the article, Americans are strongly attracted to the gated religious communities of the West Bank. In these modern suburban ghettos (in the Jewish state, no less!) religious families feel safe and comfortable, surrounded by people who share their beliefs, lifestyle and political orientation. Unlike their American counterparts, however, these gated communities are not designed to create a sense of exclusivity or to keep out robbers and other criminals. Rather, they are to keep out Palestinians. And in case the gate wasn’t enough, the communities have application exams, to ensure that all undesirables are kept out.

Security, ironically, becomes an attractive feature of these communities. The IDF serves as both a security guard and a local police force, and military law governs developments. The net effect of this arrangement is that it is much cheaper to develop land in the West Bank than in Israel proper, and those savings are passed along to the consumers. Town residents do not pay municipal taxes for their security and policing, since the army does it for them. The army has thus become a free private security provider to West Bank residents. The costs of providing this attractive level of security are not passed to customers, and unsurprisingly, consumers flock to take advantage of the bonanza.

Once upon a time, Zionists dreamed of a Greater Israel based on geography. Today, we are building a Lesser Israel, importing the crass materialism of American culture and clearly demoting the ideas of social justice and religious dedication that inspired the religious Zionists of a bygone era. I was particularly struck by this statement:

“Before we found Neve Daniel, my husband told me, ‘I love you and I want to live in Israel, but I’m very materialistic and if I don’t have a nice house, we’re not moving,’” said Lara Kwalbrun, a peppy mother of six, as she gave a tour of her luxurious new home while toting a baby in her arms.

I can understand the desire for a nice house, and it’s difficult to censure individuals for taking advantage of a bounty that will surely be claimed by others in any case. Still, there’s something grotesque about the whole thing. A few miles down the road, Palestinians live in abject poverty - a multi-generational misery that has lasted for sixty years. In the other direction, Hareidi Jews live penurious lives at the behest of their religious leaders, content to eke out a life on the increasingly miserly largess of the State. Political and military battles rage over the West Bank settlements, with thousands of casualties implicated in the conflict. And in this raging sea of destitution and desperation lies an oasis of Americans, rich from booming Northeastern real-estate markets, living their American lives in their American homes, secure in the IDF’s protection, and benefiting from a land-development strategy that gives incentives for developing lands in occupied territories over land in Israel proper.

And yet, I can’t help myself. A 2-bedroom co-op in Riverdale goes for $250,000 or more. I can get a 5-bedroom house with separate kitchens in Neve Daniel  for under $300,000! That’s a powerful financial incentive! I can’t even imagine how Palestinians feel about this. I know that it doesn’t seem right to me, that’s for sure.

As my loyal readers know (and I assume that means all of you), I don’t talk much about politics, domestic or Israeli on this blog. It just seems like in real life, political arguments can lead to new knowledge, a change in viewpoints - all the normal benefits of the free exchange of trusted information. Online, these debates lead nowhere, no matter how well-intentioned the participants.

Recent comments by Rabbi Mordechai Eliyahu, Chief Sephardic Rabbi of Israel, have forced my hand, if only because I believe that it is the responsibility of every person of moral conscience to repudiate the horrors contemplated by R. Eliyahu.

As reported by the Jerusalem Post, Rabbi Mordechai Eliyahu wrote a letter to Prime Minister Ehud Olmert indicating that the correct response to rocket attacks on the border town of Sderot is the collective punishment of the Palestinians in the Gaza Strip. An excerpt:

Eliyahu ruled that there was absolutely no moral prohibition against the indiscriminate killing of civilians during a potential massive military offensive on Gaza aimed at stopping the rocket launchings.

<snip>

According to Jewish war ethics, wrote Eliyahu, an entire city holds collective responsibility for the immoral behavior of individuals. In Gaza, the entire populace is responsible because they do nothing to stop the firing of Kassam rockets.

Putting aside the dubious claim that nobody in the entire Gaza Strip has taken action to stop rocket attacks or foster peace between Israel and the Palestinians, I’m somewhat concerned by the careless conflation of all the population centers of the Gaza Strip into one ‘city’ whose entire populace is collectively responsible. Their is an aspect of dehumanization to lumping separate people together into one general, hated group. We saw it after 9/11, where Americans, filled with anger and a desire for vengeance, could barely distinguish a Sikh from a Muslim, much less an Afghan from an Iraqi, or a Sunni from a Shiite. We’ve seen it from many right-wing Israelis, who claim that “they” don’t want peace, or that “the Arabs all hate us” - not even realizing how offensively boorish they sound when they cite the Iranian president’s vicious comments as proof (Iranians are ethnically Persians, not Arabs, and are heirs to an ancient, powerful, and proud culture that has often clashed with Arab culture).

What’s worse was R. Eliyahu’s son’s clarifying comments after his father declined to be interviewed:

Shmuel Eliyahu, who is chief rabbi of Safed, said his father opposed a ground troop incursion into Gaza that would endanger IDF soldiers. Rather, he advocated carpet bombing the general area from which the Kassams were launched, regardless of the price in Palestinian life.

“If they don’t stop after we kill 100, then we must kill a thousand,” said Shmuel Eliyahu. “And if they do not stop after 1,000 then we must kill 10,000. If they still don’t stop we must kill 100,000, even a million. Whatever it takes to make them stop.”

What would be the consequences of this evil choice? Would Palestinians in Gaza and the West Bank be cowed after a few tens of thousands of their fellows were exterminated? What about the regional damage? My guess is that Jordan would be torn by strife and revolt, as the Palestinians who makeup the majority of the population react to the tragedy. I imagine that Hezbollah and Syria would also respond violently, with Iran right behind them. Around the world, Israel would face condemnation, sanctions, and utter isolation. Even America could not back such a slaughter, and not even Aipac could stop the cutbacks in Israeli aid or the barring of sale of hi-tech weaponry to Israel, already endangered by cluster-bombing in Lebanon. I think that this action would result in the greatest Chillul Hashem (desecration of God’s name) in perhaps all of Jewish history.

I’ve gone on the record with my opinion because I feel it is my responsibility to do so, and to reject Rabbi Eliyahu. I would support any effort to remove him from his position within the government, and from within the religious leadership, and I call upon Jewish and Israeli leaders worldwide to condemn him and distance themselves from his remarks. (Surprisingly, my calls to world leaders usually go unanswered… I though bloggers had power!) What about you folks out there? How do you feel about R. Eliyahu’s comments?